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Freedom in the 50 States analysis of New Hampshire with added commentary

April 1, 2013

The Mercatus Center recently released it’s most recent Freedom in the 50 States report. The report used 2010 data to rank the various states based on a variety of factors. Here is a video with more information about the report.

The original analysis is found here (video version). The original analysis is broken up and italicized below. Following the italicized analysis is commentary in bold.


By the end of 2010, New Hampshire was no longer the freest state in the nation. The 2009—10 legislature hiked numerous taxes and fees and used one-time stimulus dollars and new debt to fund a significant increase in government spending.

In FY 2010, the state and local tax burden was 8.0 percent of personal income, seventh lowest in the country, compared to an FY 2000 figure of 7.5 percent, then lowest in the United States. State and local government consumption and subsidies stood at 9.0 percent of income in 2010, compared to 7.3 percent in 2000. Debt was at 18.8 percent of income, compared to 16.7 percent a decade earlier. While New Hampshire still scores sixth in the United States on fiscal policy, the famed “New Hampshire advantage” has dissipated. It is too early to tell whether the 2011—12 legislature, which enacted swinging spending cuts, has undone the damage.

The NH House put together a long list of 2011-2012 legislative accomplishments.

For an even deeper look at many of the positive legislative changes from 2011 and 2012, you can look at these 2 reports.
2011 New Hampshire Liberty Related Bills Report
2012 Liberty Related Bills Report 

The 2011-2012 NH legislature (perhaps the most liberty oriented state legislature in modern history) even cut the state budget by 11%. This budget cut was 1 of the 1st major budget cuts in any state since WWII. If there was a way to do a report based on current laws, I’m confident NH would be ranked higher and be either #1 or #2. IMO, That’s where NH currently is, either #1 or #2.

On regulatory policy, New Hampshire’s ranking is mediocre, although it has slightly and gradually improved since 2001. Eminent domain reforms have gone far, but exclusionary local zoning laws have driven out affordable housing in the suburbs of southern New Hampshire.

There is lots of affordable housing not only in many of the suburban and rural communities of southern New Hampshire, but also in the cities. I’ve seen 3 bedroom apartments in Manchester (the major city in southern NH) for as low as $700 on craigslist. For example, There are plenty of 2 bedroom condos for under $70,000 in Salem, NH (just 35 minutes north of Boston).

Labor-market freedom is subpar: the state lacks a right-to-work law and has a universal workers’ compensation mandate. Telecom and cable remain regulated. New Hampshire fares better than average on occupational freedom, and its liability system is one of the best.

New Hampshire deregulated telcom in 2012.

New Hampshire remains one of the few states to score well on both economic and personal freedom. However, its personal freedom score has declined slightly since 2001. Gun control laws are among the most liberal in the country, but carrying a firearm in a car requires a concealed-carry permit. Effective retail tax rates on wine and spirits are zero. New Hampshire is the only state with no seat belt law for adults. Gambling laws are strict, however.

Bills to reduce gun control passed in 2011 and 2012. Even before then, though, NH still had perhaps the lowest level of gun control in the US. In NH, children of any age may carry guns all of the same places adults are allowed to carry guns. There is also no age limit for a license to carry concealed. Teenagers apply for and receive licenses to carry. NH also has the simplest and least intrusive license in the country. In NH, children are allowed to carry in the State House, in bars, in churches, police stations and so on. Adults are allowed to open carry in bars while drinking. Freedom in the 50 States shows AZ, AK and KY as being better for gun freedom than NH. In AZ and AK, you have to be 21 to carry which means a large segment of the population is banned from defending themselves or even their own family. In KY, you have to be 21 to receive a license to conceal carry. Disarming millions of people isn’t what I call gun freedom. Realistically, NH should be ranked in the top 3 for gun freedom, even using 2010 data.

The report didn’t include taxes on cigars. NH is 1 of 2 states that doesn’t tax cigars.

While the gambling laws are excessively strict in NH, they aren’t as bad as people might think. Gambling has been legal and common in NH for decades. There were horse and dog tracks in NH but the business model was economical in NH. Still, there is plenty of betting on simulcast races. Additionally, there are 10 card rooms in NH where poker, black jack, roulette and more are legal. NH also has bingo, the lottery and various other games such as pull tabs. Unlike most states, the gambling age is 18 and not 21 in NH.

The 2011—12 legislature repealed the ban on audiorecording public officials, after the closing date of this study. State approval is required to open a private school and home school laws are mediocre; the 2011—12 legislature has since liberalized them. That legislature also enacted a tax credit for private and home school expenses. These education reforms would have put New Hampshire in third place on personal freedom. Incarceration and drug arrests are low. Same-sex marriage was also legalized during this period.

It was never against the law to record public officials in public places in NH. Perhaps some police thought it was against the law. The U.S. First Circuit Court of Appeals ruled it wasn’t against the law to record police in public. The NH Attorney General sent a notice out about it (even warning police that they could be liable for making such an illegal arrest) and it seems that police have stopped trying to enforce something they made up. There was a bill but after the notice from the Attorney General, it didn’t seem necessary and was defeated in the NH House.

Policy Recommendations

  • Enact tighter criteria for the issuance of state and local debt. Completely cutting off the $40 million in annual business subsidies and reducing interest payments by about 10 percent would permit a 20 percent cut to the business profits tax, which is one of the highest in the nation.
  • Enact a state law limiting what local governments can do to restrict new housing, such as building permit caps, minimum lot sizes, and so on.
  • Expand legal gaming beyond charity games, enact a social gambling exception, and change the “aggravated gambling” offense from a felony to a misdemeanor.

While the business tax rates are above average in NH, the actually effects of those taxes on very small businesses is minimal. In fact, there were several reforms designed to reduce business taxes in 2011 and 2012. A small business with just 1-3 employees may be designed to pay a level of business taxes well below the national average. For example, a recent survey of small business owners found that NH is #3 in the country for small business friendliness and is an A+ state for tax code.

NH allows some non-charity gambling such as raffles, pull tabs and the lottery. 1 bill designed to expand gambling passed the NH Senate (SB152) and 2 passed the NH House (HB314 and HB520) so far this year. There is a chance all 3 bills will become law.


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  1. New Hampshire Ranked 4th Freest State | NH For Liberty

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